ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Can Increasing Global EV Adoption Threaten India’s Growing Auto GVC Exports?

India’s impressive performance in automotive global value chains, due to stellar exports of traditional internal combustion engine intermediates and vehicles, is being challenged by the electric mobility revolution worldwide. This article delves into the challenges that India should overcome to feature in greener auto GVCs of the future.

 

The authors acknowledge and thank the unknown referee for insightful comments which have improved the article substantially.

India is one of the largest manufacturers and exporters of automobiles and auto components through growing global value chain (GVC) participation. Ray and Miglani (2018) single out the Indian passenger car industry as one of the most successful cases of GVC integration building on the consistent government support complemented with investment in infrastructure and growing domestic demand. Dash and Chanda (2017) identify firm-specific as well as macro and financial factors that have grown Indian firms’ automotive GVC participation. Deregulation and liberalisation are also found to have had an enabling effect on growing the supplier–original equipment manufacturer (OEM) relationship to promote India’s auto GVC participation (Saripalle 2016). Meanwhile, the global auto sector is undergoing a transition. As concerns of climate change and vehicular pollution take centre stage at various international forums (UN SDGs,1 G20 communique documents2), the world is adopting energy-efficient ways of transportation. In order to sustain its performance in auto exports, India would require to respond to the changing demands of the world. It is thus important to analyse India’s auto export trends, response to climate change, and possible threats to its evo­lv­ing position as a major auto exporter of the world.

Electric vehicles have been well received as an answer to environmental pollution, which contributes to controlling climate change (Sajjad et al 2020). The changing geopolitics in addition to oil price fluctuations, post-COVID-19 shifts in supply chains, and related developments have encouraged many to think about alternate fuels to power transportation of the future. We explore India’s current position in auto GVCs and derive implications of global shifts in transportation on growing our auto exports.

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Updated On : 17th Oct, 2023
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